Watch CBSN Live

@ GDC: Game Developers Get The Short End Of The Money Stick

This story was written by Tameka Kee.
The video game business may be booming for major publishers like *Activision* and *EA*, but the people that actually create the gamesthe developersaren't exactly getting rich. By some accounts, less than four percent of console-based games developed in a given year turn a profit for the artists, writers and programmers that actually create them. And that's a problem, according to game industry attorney Jim Charne.

Charne, who helped Halo developer Bungie Studios negotiate its spin-off from *Microsoft* in 2007, led a roundtable discussion about the big legal issues currently affecting the gaming industryand the one-sided financial deals between developers and publishers came up as a sore point. Part of it is because the cost to create games keeps going up. "A high-quality game can cost about $15 million to create over the course of two years," Charne said. "And there's a ton of risk that a game won't be profitable, so game companies are looking for every opportunity to make money."

Oftentimes, that means paying developers on the cheap up front and cutting them out of back-end merchandising deals: "If a publisher turns a game into a movie or a comic book, or creates a tips and tricks book, for example, the developer or the game writer isn't likely to share in that extra revenueand that needs to change," Charne said. "Publishers do have a tremendous amount of skin in the game, but there wouldn't be a game if it weren't for the developers. You can't just hire anyone to develop a game, and they need to be appropriately compensated for their expertise."

By Tameka Kee

View CBS News In